Hi Folks.
Welcome back to another forecast, albeit only a slightly better one than last week's. At least we have a couple of days where decent (or formerly decent) numbers drop, so we have that to look forward to. I'll also mention now most of the Fed Heads from around the world are gathered in Thailand for a vacation disguised as work, so I'll mention it here so I don't have to keep typing it later. Their speeches are all on Thailand time so from a US and even European standpoint, they aren't likely to do anything during those sessions, but Asia could see a few more fireworks than normal. So all you Asian session traders keep an eye on the calendar this week for any surprise late additions to the speaker lineups. You can't really trade their speeches, but since their speeches can steamroll otherwise perfectly good trades at the drop of an errant word, you need to know if they are jabbering while you are trading.
Now on with the show.
SUNDAY: The only entry is a reminder that Japan banks are closed on Monday morning (our Sunday evening) in observance of Health Sports Day. Japanese bank holidays are so much better than anyone else's.
MONDAY: Asian/London Session: So we might as well get this one out of the way first: Canadian banks are also closed in observance of Thanksgiving. That's a national holiday that I can understand. Also, the IMF holds meetings today. As for the rest of the A/L session, it's mostly Fed speak split between Bangkok (5:30 a.m., 11:00 p.m.) and Cleveland (8:50 a.m. and 12:10 p.m.). As for actual numbers, Great Britain has a Retail Sales number dropping at 7:01 p.m. (midnight:01 local time, so Pass), Bank Lending and PPI from Japan at 7:50 p.m. (both are a Pass), and finally, Australia has their Minutes from their last Monetary Meeting and their NAB Business Confidence. One is a report, the other is a number, and both are a Pass.
USA Session: In keeping with the trend so far, today is also a holiday in the US: Columbus Day. Banks are closed but the futures and I believe the Stock markets are open. But holiday trading is normally somewhat light so proceed with caution if you trade the indices.
TUESDAY: Asian/London Session: German Final CPI drops at 2:00 but rarely moves the EUR prices at all. The balance of the morning session is Fed Speak with Waller from the US in New Delhi at 3:45 a.m., along with a quick reminder today is Day Two of the IMF meetings. At 10:30 a.m. my time Australia drops their Conference Board Leading Index number, one that is universally ignored by all traders across both boards: none of the individual country numbers do anything and traders everywhere ignore them all. The evening New Zealand and Japanese numbers won't generate more than 5-10 pips for their respective currencies, and the remaining 5 entries are Fed Speak (noon London, 1 p.m. D.C., 4:00 Boston, 10:10 p.m. Lagarde in Bangkok and 11:30 p.m. Bangkok).
USA Session: 6:00 a.m. is that NFIB Small Business Index (the time is the dead giveaway...Pass). 8:15 a.m. is the weekly ADP Employment Change number which is ignored by traders everywhere. You should follow their lead. Pass. 10:00 a.m. Existing Home Sales is an actual number that most traders actually ignore, so Pass here as well. 1:00 and 4:00 p.m. Fed Speak was noted earlier, in D.C. and Boston, respectively. Can't trade it, but be aware it's out there.
WEDNESDAY: Asian/London Session: Let's get Bangkok/IMF out of the way first. 1:30 a.m., 2:00 a.m., 2:05 a.m., 4:30 a.m. (Lagarde, so pay extra attention here), 5:40 a.m., 10:55 p.m., and 11:35 p.m. Two of those (Bowman at 5:40 a.m. and 10:55 p.m.) are technically US Fed Speak but since Bowman is chattering during the A/L session I'm including it here. After all the talky-talky, we get German Wholesale Price Index, which is an automatic Pass since no one trades it. Canadian Building Permits at 8:30 once upon a time was good for 20-25 pips but lately has been a little stingier, with 11, 18, and 9 the last 3 months (and the 18 was paired with a few other numbers that generally do better than CBP on the whole). Great Britain drops their own Conference Board Leading Index number at 9:30 (the same as Australia did yesterday with the same results: no one will care). The Japanese Core Machinery Order number is sub-20 pips as far back as I can see, so Pass. And finally, the 8:30 p.m. Australian Employment Change number, a Red Folder event on FF, has generated a grand total of 22, 19, and 23 pips over the last 3 months. Considering 2 out of 3 broke 20 pips, with the third just missing the mark, AND news based trading the last couple of weeks has been pathetic at best, means this is a definite Trade Watch number. So be ready for this one.
USA Session: CPI at 8:30. One of the last few High Holy Days of trading and this week CPI drops before PPI, so all is once again right with the trading world. 52, 29, and 35 pips over the last 3 months make this one an Automatic Trade, with direction TBD. After CPI it goes downhill fast. Fed Speak at 1:30 p.m. (Barkin, aka "Short Straw" misses out on Bangkok and instead gets the highly coveted speaking slot at the Richmond Virginia Chamber of Commerce rubber chicken event). The Fed Beige Book drops at 2:00 p.m. (a report, not a number so not much we can do with it) and finally that API Oil Report at 4:30 p.m. after everyone has called it a day.
THURSDAY: Asian/London Session: The earlier stuff is meaningless (I'll cover the Fed Speak in a minute) but Great Britain drops their GDP m/m along with a bunch of related and unrelated numbers at 2:00 a.m. I've mentioned recently that a few months back these British numbers were automatic trades, but not so much lately. This one has handed out 14, 24, and 16 pips over the last 3 months, with the 24 landing on a day when expectations for GDP were 0.00% but the number came out at +.3%. That's a big enough miss to justify a little extra zoom behind the number. So take note of the actual number when it drops. A big miss could equal a big price move. Hitting the target likely means another 14 pip move over the next hour. 8 separate Fed Speak entries across both sessions, all in Bangkok at the IMF shindig: 12:30 a.m., 2:45 a.m., 3:30 a.m., 4:45 a.m., 5:00 a.m., 10:00 p.m. (Bailey from the BOE), 10:30 p.m. (Nagel from the German Buba), and 11:30 p.m. (Warsh from the US Fed, included here because he's speaking during an A/L session).
USA Session: PPI drops today, a day after CPI as God intended. Typically a smaller trader response when the batting order is maintained, with 17 and 18 pips being the response 2-3 months back. Last month popped with 35 pips, but last month PPI dropped first, CPI second. So with balance restored to the Force, expect a smaller response and one likely not worth trading. Retail Sales drops at the same time as do several other numbers, including Weekly Unemployment, but with CPI yesterday likely creating its usual havoc, expect today to be slower and likely not worth trading. NatGas is at 10:30, Crude Oil at noon (thanks to the Monday holiday) and we close out with some non Bangkok, non-IMF Fed Speak at 4:40 p.m. (Hammock giving a fireside talk at some Woman's Trading Network event.
FRIDAY: Asian/London Session: We lead off, no surprise this week, at 12:15 a.m. with Fed Speak at the IMF Bangkok house party, and amazingly enough it's the only Bangkok entry today. Likely it's the 2 for 1 drink specials at Soi Cowboy that caught the attention of the rest of the IMF today. 5:00 a.m. is the EU's Final Core CPI, a number that consistently reinforces the notion that only the US and GB CPI's are worth trading. This one never seems to break 20 pips, so Pass. Nothing else on calendar today that is even worth mentioning.
USA Session: A pretty sad lineup to end the week in the US as well. Import Prices at 8:30, followed by Cap. Utilization and Industrial Production at 9:15 a.m. None of these are designed to move price even slightly. That mythical Federal Budget Balance number is listed as "tentative" which makes it even easier to ignore, and finally, TIC Long Term Bond Purchases at 4:00 p.m. drops after virtually the entire world has shut down their platforms for the weekend. Hopefully you have done the same by now.
And that's it for another week. See you back here next Sunday, hopefully with some better numbers on tap.
Jeff
